The Jersey Financial Services Commission is implementing changes to the way it imposes sanctions following criticism that its decision-making process has become “unnecessarily lengthy and certain elements quite cumbersome”.
The regulator said its process “is not as efficient as it could be” and has opened a consultation on how to fix it, following an internal review.
International Adviser contacted several Jersey-based companies to understand how the proposed changes could impact advisory businesses, but all of them declined to comment.
The Jersey watchdog’s current framework is split into two categories: executive decisions and board decisions. The latter is the one at the centre of the consultation as it is involved in the regulatory sanction process.
The consultation paper is open for feedback until 1 September 2021.
Amendments
One of the proposed changes is for the individuals or firms involved to have a “full and fair hearing before the persons who will determine their case”. The regulator said that this would make the process less complex and bureaucratic as well as easier to understand for those involved.
Additionally, the review committee system will be replaced with a less formal and quicker, internal review process; and the first meeting of the board will become a committee of three commissioners rather than the full board.
If the committee then believes the individuals or firms have breached regulatory requirements, it will issue a ‘notice of intent’ setting out what sanctions are being proposed and why.
The final determination will be made by the three commissioners who will consider any written or oral representation made by those in question on the notice of intention. These changes, however, could be “temporarily suspended” if the regulator enters into settlement discussions with the people or firms involved.
The Jersey regulator said these amendments would make its decision-making process “less expensive for the JFSC to operate – and, thus, less expense for industry to fund via JFSC licence fees”.
“It will also reduce the direct costs of those businesses or individuals that find themselves subject to the decision-making process,” it added.
The watchdog does not plan to include its settlement policy in the consultation, but it will publish a “discrete and updated policy statement” on the issue when the finalised version of the consulted changes is published.
